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Book Review: Inventing Bitcoin

By January 1, 2023No Comments

Inventing Bitcoin

Rating: 4/5

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Inventing Bitcoin Summary

Inside Out: Money As A System Of Control

Inventing Bitcoin by Yan Pritzker is my favorite high-level technical summary of bitcoin that the average person can understand. Yan gives a concise, less than 100 word, breakdown of how bitcoin is technically sound, what problems it solves (Byzantines General Problem), and a sweeping overview of it’s functions & uses. Never thought a Bitcoin book could be so small yet pack such a powerful punch.

Inventing Bitcoin Quotes

Banks are just ledgers

“Cracking the encryption of bitcoin would be like properly guessing the location of a single atom in the universe”

Bitcoin mining is repeatedly “rolling the dice” until you hit the right number. “

-- Yan Pritzker

Inventing Bitcoin Lessons

  1. Now that money is primarily digital it inherently got centralized
  2. The 2017 Equifax hack was a direct result of centralizing data
  3. Fiat, in Latin, means “let it be done” or “by decree”
  4. In Venezuela in 2009 the exchange rate was 1:2 for bolivar to USD, in 2019 it was 1:250,000
  5. Bitcoin wasn’t invented in a vacuum, it pulled upon decades of inventions in computer science & cryptography specifically, Wei Dai’s b-money, Adam Back’s Hashcash, and Proof of Work
  6. As many atoms in the universe as there are possible hashes. In other words, breaking it would be like guessing the exact location of one atom in the entire universe 
  7. A single block is: a group of transactions + nonce + PoW hash
  8. Hash rate is the number of hashes per second of all the miners
  9. Block rewards for miners started at 50 BTC per block, then got cut in half every four years per Satoshi’s design
  10. UTXOs allow for easy and efficient validation of double-spending
  11. Two types of forks exist: soft forks & hard forks
  12. Every blockchain competitor either centralize by trying to move too fast or moves too slow and can’t accumulate the  hash power to compete

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